FreshCo expands Chalo! grocer to B.C.

The Sobeys banner expands to new markets as it looks to reach a growing South Asian population.

chalo-image

Originally billed as the “first Canadian grocery store designed for desis” (South Asian expats from India, Pakistan and Bangladesh), Chalo!, a FreshCo multicultural banner, has moved beyond Ontario and into B.C.

Two locations recently opened in Metro Vancouver/Surrey (July 11), specializing in bulk ingredients, including rice, halal meats, teas, and other South Asian staples.

According to Stats Canada data, 5.4% of the Canadian population and 32% of the Asian Canadian population identifies as South Asian, and the group is growing (Nielsen data shows that this mirrors the growing multicultural consumer segment overall, which is expected to double in size to 15 million people by 2036).

Sobeys (which owns FreshCo) has been following the strategy of building the Chalo! brand (Chalo means “let’s go” in Hindi and Punjabi) and rolling it out to growing South Asian communities. By contrast, its competitors, like Walmart, will stock ethnic food in dedicated aisles; while Loblaws and Metro have purchased ethnic grocery chains and let them run independently of those banners (for example, Metro’s Middle Eastern food-oriented Marché Adonis, or Loblaw’s Asian market, T&T).

chalo-image2

Ishan Ghosh, CEO and partner at multicultural marketing and ad agency Barrett and Welsh, was part of the the team that assisted with the launch of the first Chalo! store in Brampton in 2015 (Chalo! has since expanded to four outlets in the GTA).

South Asian shopping habits, he says, include combining ethnic grocery stops with a mainstream location stop. Based on that insight, Chalo! was designed as a one-stop-shop that’s easy to navigate so “you don’t have to search for an ethnic aisle, because it’s all an ethnic aisle,” says Ghosh.

Ghosh says studies show that South Asian consumers over-index on coconut water, rice, hot tea and cooking oil. And the ethnic group typically spends more on groceries than the average Canadian, as their households tend to be larger, Ghosh says.

“When it comes to actual grocery shopping, South Asians still want the store experience as it’s an event for them, they come with the family.” It’s not about convenience, Ghosh stresses, stating that they want to “get it right” and will “take a lot of time” shopping the grocery aisles.

The stores, he says, were designed to replicate more of the shopping experience South Asians are familiar with back home in terms of way-finding and signage. The brand recruited strategic design agency Shikatani Lacroix to help with the grocery store development, which includes formats like hand carts (push-carts common in South Asian market stalls).

He adds that rice displays in Chalo! are very different from mainstream grocers, and they include what he describes as a “wall of rice” differentiated into slender, parboiled, aromatic, and a countless array of varietals. There are also language distinctions at the shelf level, using eggplant as an example, which is referred to as “brinjal” in South Asian communities.

Ghosh says the first Brampton store led to some learnings, which the team will apply to the Surrey location. For example, they will have to be cognisant of some of the subtle language distinctions within the dominant Punjabi language between stores: it’s the same language, with the same script, but the two groups came at different times and that’s reflected in language, he says. Brampton and Mississauga migration patterns are more recent, whereas communities in BC more entrenched.

chalo-image3

Bobby Sahni, partner and co-founder, Ethnicity Matters, stresses that there is no one-size approach to marketing to multicultural communities.

Sahni says grocery stores, like Chalo!, would also benefit from being accessible, relevant and approachable for non-South Asian consumers as well. He cites Longo’s as an example of an Italian grocer that has a Mediterranean heritage and palette, but isn’t considered an “ethnic” store by the non-Italian consumers. Sahni says it’s a reflection of broadening taste preferences of Canadians.

Whether a retailer is successful in reaching out to multicultural consumers, says Ghosh, depends on whether corporate diversity mirrors that of the broader community. “Diversity of leadership is important,” he says, adding that the Chalo! brand launched with a diverse team that helped get the right merchandising, design and messaging for the right audience.